December 22 2014 Latest news:
Wednesday, January 2, 2013
Business confidence remains low but there are some “positive” economic signs for the year ahead, according to the Federation of Small Businesses.
National chairman John Walker said that 2012, when the UK dipped back into recession, had proved tough, but suggested the picture for the coming months was a little brighter than it had been in recent years.
But he criticised the banking industry for pushing many businesses to the wall through mis-selling financial products and warned that it must work hard to rebuild trust with small firms.
In his New Year message, he also told the Coalition that his members are facing a “huge compliance burden” under changes being introduced in April which will force all companies to report their payroll information in real time.
Mr Walker said: “Confidence is still low, with many concerned about lack of demand and wider economic issues, but our members are heading into 2013 with more confidence than they did going into either 2011 or 2012.
“This is a move in the right direction and something the government must build on in the new year.”
“The signs seem to be positive, but it’s going to be a long road ahead with some economists warning of a triple-dip recession, and others cautious optimism.”
The FSB national chairman said banks are still failing to provide the finance companies need, with less than 10pc of small businesses reporting easy access to the credit they need.
Mr Walker said the organisation had also tried to work with banks and the Financial Services Authority to find a way to resolve the mis-selling of financial products “scandal”.
“It has been a year of financial scandal with this mis-selling and the manipulation of the inter-bank lending rate,” he said.
“Too many businesses have failed because of this, but I want 2013 to be the year when a line is drawn under this sorry saga and firms are given the redress they deserve.
“It has already gone on for too long and, until it ends, business and banks will not be able to rebuild the broken relationship crucially needed to help bolster the confidence of small firms and the wider economy.”
From April the government expects the “vast majority” of businesses to report payroll changes as they happen under the new Real Time Information system.
It is being brought in to make PAYE deductions more accurate and will be used as part of the new Universal Credit system which will replace most benefits in October.
Mr Walker warned that will prove difficult for many smaller firms, with many unaware of the changes they are expected to make.
He said: “The move to make small firms report their payroll in real time - Real Time Information - will place a huge compliance burden on the smallest firms. Indeed, many will have to buy new software to deal with it.
“But we know that many firms still don’t know it’s coming in - and it starts in four months’ time. The new year must see a big step-up in the communications campaign to make businesses aware of the new rules. We will continue to work with HMRC to make sure this message is communicated to small firms.”
Plunging oil prices will have a damaging effect on the region’s energy sector, but the impact will be more keenly felt in Scotland, industry experts have warned.